The Growth Of China's Smartphone Market Is Absolutely Staggering

China will be 2x the US smart phone market in a year! Only
two years ago, China was a laggard with a tiny portion of the US.
What happened?

Originally, China's market developed more slowly because of two
reasons. First, usable 3G networks took much longer to develop
than other countries. Second, there are few subsidies in
China, so users had to pay one or two month's salary for an
iPhone or Android. These inhibited the growth.

But both issues have changed. Broadband wireless is now
over 58%, and smart phone prices have dropped to about $100 for
an acceptable Android phone, and about $200 for a full-featured
Android phone. Smart phones are now spreading like wildfire.

About a year ago, there were less than 50M users, basically
affluent or tech savvy users who were willing to pay $500 for a
phone and $30 a month for 3G. But now, students, young
white collar, and even blue collar workers are swarming into the
smart phone market!

The figures above shows all numbers are off the charts -- Android
activations, real usage of applications, broadband usage, and
penetration into less developed areas. This year, there
will be an installed base of 250M smart phones. Next
year, there will be an installed base of 500M smart phones!

So who will gain from it? Apple will take a healthy and lucrative
minority share, just as it does in the US. Microsoft just launched its products in China,
though their success remains TBD. Google would have been the big winner, but
unfortunately due to the Google-China issues, most Android phones
are installed with non-Google services. But app developers,
entrepreneurs, some phone and chipset manufacturers (and
investors like us) will have a field day!